Rita Crompton “The Inventor Lady” Teaches How To License Your Product

Hugh Ballou
World Renown Author, Speaker and Transformational Leadership Strategist the Name Hugh Ballou is Music to Inventors and Entrepreneurs
April 10, 2017
Warren Tuttle
Warren Tuttle, United Inventors Association President, Talks Free Patent Legislation and More
April 19, 2017

Download Inventors Roadmap to Success on Google Play and iTunes!

Google Play Apple iTunes


Watch the podcast here!

 
 
Over the past thirty years Ms. Crompton has startedor helped to start no less than five successful businesses in four distinct and unrelated industries. Because of her superior marketing skills and the business relationships she has established and nurtured in the national marketplace, Ms. Crompton and her company, FLeCusa International, provide a unique service to clients wishing to enter the marketplace or grow their business to a new level, nationally or internationally. During this adventure, Ms. Crompton has delved heavily challenges inventors face as they enter the world of due diligence/manufacturing/funding/marketing/selling their product.
www.inventorlady.com

The Inventors Launchpad – Roadmap to Success Series is presented by Inventors Launchpad in beautiful Tampa Bay, FL and hosted by Carmine Denisco. Carmine is an accomplished Author, Entrepreneur, Inventor and Co-founder/Managing Partner of Inventors Launchpad. Along with his business partner Rick Valderrama has changed the face of the invention industry and look forward to helping inventors from all over the world move their ideas forward. For more information please visit www.inventorslaunchpad.com

Podcast Notes

1You Tube generated podcast notes, please excuse any typos.
0:00 hi everyone and welcome to inventors 0:04 Launchpad roadmap to success this is 0:07 common dennis go your host for today's 0:09 episode and today on the launchpad we 0:12 have a licensing expert he's an inventor 0:15 she's an inventor advocate she really 0:18 really loves educating inventors on the 0:21 way to move forward whether they're 0:23 going to go to retail going to go to TV 0:25 shopping but her main focus is licensing 0:27 products which is one of the things that 0:29 I get questions about all the time 0:32 everyone not everyone but most inventors 0:35 and most product developers want to 0:37 license their product because they don't 0:38 want to be in business they don't want 0:40 to be a business person they just want 0:41 to go about inventing and developing her 0:44 name is Rita Crompton and I think she's 0:46 on the one line now are you there either 0:47 I'm here well hello and thank you for 0:51 being on the show today how's it going 0:53 out there it's nice and sunny today yeah 0:55 that's good you're out in the colorado 0:57 area i am right just west of the Front 1:01 Range there so I give an ICU the 1:03 mountain oh yeah it's some nice area 1:05 we're out here in the Clearwater Florida 1:07 and we enjoy the sunshine as I know that 1:09 you do and again I'm glad you're on the 1:12 show um you're talking about license of 1:15 questions sent to us at the launchpad 1:18 about licensing and it's so important to 1:21 get the right information licensing is 1:23 such a great outlet for an inventor and 1:26 that's what so I was excited to have you 1:28 on the show first off let's see a step 1:30 back whether I could get into what 1:32 you're doing oh yeah okay that's kind of 1:36 funny because I always say that God was 1:38 actually talking to me one day and I 1:39 shut up and listen you know and when I 1:42 look back over my history I was kicked 1:45 out of the Girl Scouts in the fourth 1:46 grade for selling too many cookies I 1:48 invented going around and taking orders 1:49 I have been an entrepreneur all of my 1:52 life and so you know i look at the steps 1:55 and my skill set is helping people kind 2:00 of get out of their own way it's seeing 2:01 the bigger picture it's getting out of 2:03 the traditional sandbox and saying well 2:05 what if we used it this way well how 2:08 about going here and helping inventors 2:10 really see that bigger picture and 2:13 to keep them on track you know life gets 2:15 in the way for everyone it does me too 2:16 and then the goal is to get back on 2:19 track you know how do you get come a 2:21 time table set and then stay on track 2:23 and that's my skill set is to see the 2:25 bigger picture and keep them on track 2:26 yeah well looks fine you don't take 2:30 shortcuts I don't let people drink a 2:31 little umbrella drinks into ET you know 2:33 when we still got a lot of work to do 2:34 I'm glad you think that because doing 2:39 this in the right sequence is one of the 2:41 most important things at an inventor to 2:43 do but to try to leapfrog or jump there 2:47 are no shortcuts I do not have a crystal 2:49 ball I can't make promises on that 2:52 something is absolutely going to happen 2:53 so it's a very sequential you know one 2:56 step we mix it mix the next set of 2:58 decisions based on the information we 2:59 gathered at the previous step very 3:02 logical yeah so when you when you 3:05 started getting to this was there was 3:08 there something i don't know i don't 3:09 know how many years you been how long 3:11 have you been doing this i'm not going 3:12 to tell you all dates me know over 10 3:15 years over 10 years unselect that have 3:17 been an entrepreneur and have multiple 3:19 businesses in your industry over the 3:21 years rather than dip decades but I've 3:25 been around for a while well again I 3:28 read that you did have several 3:29 businesses and that's kind of even in 3:31 the same way I mean as you progress 3:32 through your business and gathered 3:35 knowledge it's so much fun to to help 3:38 other entrepreneurs are inventors with 3:40 your knowledge and education but 3:42 bringing them back down to earth and 3:43 getting them in that sequence as you 3:45 said is so important it really is 3:47 because they have and I don't want to 3:50 say anything bad i mean inventors were 3:51 all inventors we were getting excited i 3:53 get excited about my own product yeah i 3:56 need somebody to pull me down and say no 3:58 you know you can't do that you can't go 4:00 that fast so when you're looking at four 4:02 products are looking at a product what 4:04 do you what do you look forward you look 4:05 at the inventor first do you look at if 4:07 they have a team together or do you look 4:09 at just a product oh it really depends 4:13 the first thing I look at is the product 4:14 does it have some length you know we do 4:16 some due diligence is there anything 4:18 else out there you know they always say 4:20 oh there's nothing else out there like 4:21 it it's like you know what's give me 15 4:22 minutes and it's like you know you might 4:25 want to buy that one on amazon for 4:26 2495 because it's going to be a lot 4:28 cheaper than filing a patent like oh no 4:30 there's nothing else out there well you 4:32 know a lot of concern is now having a 4:34 better widget is a good thing having 4:38 something that is totally new and novel 4:40 is not always a good thing because now 4:42 you have to pay a lot of money to 4:44 educate the consumer that you solve a 4:46 problem they didn't know they had and 4:49 that can be really expensive so you know 4:51 a better flashlight everybody knows what 4:53 a flashlight is for but now you've got 4:55 one that wraps around a pole instead of 4:56 having to hold it so sometimes that's a 4:59 good thing it's faster into the 5:00 marketplace so we look at those types of 5:02 things is a disposable non-disposable 5:04 you know what is the potential market 5:06 place the guy gets dumb in southern 5:08 Colorado get an amazing full-size 5:10 functioning tractor limited market as 5:13 opposed to the person who did the really 5:15 cool baby teeter we look at those kinds 5:18 of things on you know what is it what is 5:21 the potential point to be and for a lot 5:24 of folks that's the big thing is you 5:26 know it's easy to go to a trade show and 5:28 launch a product when it's a baby 5:30 teether or i can carry it in tractor not 5:32 so much and again like you said it's it 5:36 could be a limited market I mean you 5:38 don't want to go after a market that's 5:40 very small even though most inventors 5:43 you probably hear you ask them who their 5:45 who their client database is who the 5:47 target market is and they say everyone 5:49 right and you know then I want to know 5:51 what have they done so far and we always 5:53 say you know do as much digging around 5:55 as you can try to find you know websites 5:57 then when they get to the point where 5:59 they've done their own version of a 6:02 prototype duct tape cardboard Legos pipe 6:04 cleaners I don't care what they've got 6:06 laying around the house they can get 6:07 something out of their head and in 6:10 three-dimensional and so for some people 6:12 are better at drawing than they are 6:13 actually doing something out of play-doh 6:15 that first one is just really really 6:18 rough and then we look at doing a 6:19 professional search and this is 6:22 professional search in patent and 6:26 product because there's a lot of things 6:27 as you know that are out there that are 6:28 not patented but they become part of the 6:30 public domain so that would influence 6:32 somebody's ability then to go ahead and 6:34 successfully file a patent so that's the 6:37 next step we look at is that 6:38 professional search 6:39 not something that is necessarily done 6:41 by an attorney just because they tend to 6:43 charge a lot more um but you know giving 6:47 them the inventor another set of eyes 6:49 it's going to be looking through the 6:50 USPTO the international filings and then 6:54 product filings it is amazing how many 6:56 science students made a public 6:58 disclosure and now they're in you know 7:01 there in the marketplace even though it 7:03 was just a science project and I saw oh 7:05 because they're in the public eye as 7:08 soon as they presented that's right yeah 7:11 i just got done judges judging the state 7:13 science fair last Thursday and for any 7:15 of those kids that had a potential 7:17 product they made a public disclosure at 7:18 that science fair oh yeah and they're 7:21 not getting everybody there to sign an 7:23 NDA so it's kinda psychic preferred yep 7:26 and so you know those some of the things 7:28 that we look at is you know the due 7:31 diligence you know that bet search what 7:33 comes back in the search you've been 7:35 done in other countries it doesn't 7:37 matter where it was done if it's been 7:39 done at any time in history any place in 7:42 the world it affects your ability to 7:44 file successfully in the US yeah and 7:47 it's super important that you're going 7:49 to try to license I mean a company that 7:52 you're going that's going to want to 7:53 take over your product is really how 7:55 deep into it how much due diligence do 7:58 they complete you know once you know if 8:01 when they have the professional search 8:04 done alright that's kind of one step 8:06 removed so I tell people you know look 8:08 dig around on the USPTO website they've 8:10 got a very good tutorial you know when 8:12 your eyes kind of roll back in your head 8:14 then it's time to move on and get that 8:17 third party search done we've got a 8:19 pretty good company that nobody it 8:21 worked with that's what you take in to 8:23 your attorney you know whichever one 8:25 you're but there's again no shortcuts 8:27 they're going to file a provisional it 8:30 needs to be a good one you don't get to 8:31 hire somebody that filled in the blanks 8:33 I can circle the words they filled in 8:36 and if I can do it somebody else can and 8:37 I had a guy do that he says let me send 8:40 you what I filed like okay and I said I 8:43 can circle the words this isn't going to 8:46 stand up in court and it's someone then 8:47 we get to the point of Licensing they 8:50 need to know that they can defend it 8:51 because they're going to take on that 8:52 respond 8:52 Tony yeah that thing each step is so 8:55 important and someone else is going to 8:58 be giving you money for your product 9:00 it's so important it really isn't so I 9:02 mean it so you go through and you find a 9:05 product and then you're going to go dot 9:06 your i's and cross your T's what about 9:09 their product itself I mean have you 9:11 gone through ones that we're just 9:12 drawing ones that we're functional or 9:15 just prototyped those do companies you 9:19 know it's funny because you know ask 9:20 somebody will how many prototypes you 9:22 having I've got a museum full of 9:23 prototypes because you know you build on 9:27 it they'll have their first one that's 9:28 you know out of Legos or play dough or 9:30 pipe cleaners or whatever and then they 9:31 not go and get a 3d printed one then 9:34 they test it then they know they've got 9:35 to make some changes in the size or this 9:37 part doesn't work just right 3d printing 9:39 is wonderful because you can make 9:40 corrections for a few hundred dollars 9:42 now instead of thousands of dollars and 9:45 so we look at you know getting that sexy 9:47 prototype finished up and to go to you 9:51 know that first kick of marketing and 9:52 launching a product we need patent 9:54 pending and a sexy prototype do not need 9:57 inventory yeah unlike something not the 10:00 licensing them nope now it's great if we 10:03 do if we get to the point now where 10:04 we've gone to a trade show we know 10:06 there's some due diligence there there's 10:07 an interest in the product um you know 10:10 packaging isn't going to be too terrible 10:11 we can sell on amazon you cancel orders 10:14 maybe do a Kickstarter campaign for some 10:16 folks we go to a trade show we launch 10:17 the product we come back we launched a 10:19 Kickstarter campaign so we've got more 10:21 options now as far as building towards 10:24 that licensing goal that's that's a 10:27 that's a good point so what about when 10:29 you're going after these licensees if 10:31 you're going after multiple you'll want 10:33 to have either more than one prototype 10:35 or if like you said you did a small run 10:37 and you have some manufactured it's 10:38 easier to send it out do do companies 10:41 ask about sales because it or you do you 10:44 tell them this is a brand new product we 10:45 haven't made sales we're looking the 10:47 license that you are you tell them right 10:48 off the bat yes we tell them right off 10:51 the bat exactly where we are that we you 10:53 know we've got sexy prototypes and Alexa 10:55 property filed we haven't sold any 10:58 because we have a manufactured any yeah 11:00 if we need to do then a Kickstarter 11:02 afterwards just approved sales 11:04 Kickstarter is great on you know 11:06 to go though because now they they pay 11:08 for it upfront so the inventor is not 11:10 out you know the tens of thousands of 11:12 dollars from manufacturing you know we 11:14 can usually get moles covers and a lot 11:16 of times the licensee will buy the molds 11:18 or the tooling and any inventory that 11:20 you may have for some of that is that's 11:22 great but I've got any letters going to 11:24 the national hardware show where their 11:25 money was put into a single prototype 11:28 and that is all we've got to work with 11:29 and I've license with that mmm sexy 11:33 prototypes in and for a lot of them 11:35 that's what they're needing a good 11:37 licensee they don't necessarily need to 11:40 they know what they're marketed they can 11:43 get a good licensing they can look at it 11:45 and know basically a ballpark of what 11:46 it's going to cost them to manufacturing 11:48 know their their book of business and 11:51 who's going to buy it when they get down 11:53 to that minutiae of it's like well you 11:56 know it's going to how much does it cost 11:58 you to manufacture it I say run because 12:00 they should know how much it's going to 12:02 cost them to manufacture and it's always 12:04 going to be cheaper than it cost you yes 12:06 know that there's no doubt about that 12:08 you're you're exactly right boy there's 12:11 so many questions when you're getting is 12:12 because and we get only cry yeah you 12:15 know we get so many times that want to 12:17 know about licensing and and you're just 12:19 hitting this stuff so fix it so fast 12:21 that's great um so so when you're 12:24 approaching a licensee and and do they 12:29 sometimes are going so so I'm just 12:32 trying to think of us we put so there 12:34 are they going to make changes to it oh 12:35 so it so you don't worry want to order 12:37 10,000 units because they may make 12:39 changes they may just want be though 12:41 they might just want the intellectual 12:43 property right and we look at you know I 12:46 worked with attorneys in the password 12:49 you know they understand that skill set 12:51 that it's got to bump up against and 12:53 that's why the search is so important 12:54 because they want to know that ballpark 12:56 of what's out there and then if they 12:57 need to fine-tune the search they know 12:59 which classification to go to I talk to 13:01 my hands so I'm moving around too you 13:03 know vacations to go to right away to 13:05 fine-tune that if they need to and then 13:07 we want that intellectual property to 13:09 bump up against whatever else is there 13:11 so the inventor has got you know some 13:13 wiggle room in making changes to the 13:16 design that still will be covered a good 13:19 patent is not 13:20 industry-specific right it is not sighs 13:23 specific it is not material specific so 13:26 I had somebody one time they said well 13:28 we want to make it out of a 13:29 biodegradable material and I said well 13:31 you can and they said well why not I 13:32 said because your attorneys that it was 13:34 made out of aluminum that'd be pretty 13:36 much that's it right there oh you know 13:38 they were able to go back and file a CIP 13:40 and correct that but inventors need to 13:43 be aware that you know you say something 13:45 made out of but not limited to so in 13:47 five years a new material comes down 13:50 that makes your product better you don't 13:51 want to be obsolete vitally yeah you 13:53 know and as Venters and what we learn is 13:56 to be specific and it's so hard to 13:59 change those tides when you're doing a 14:01 patent because you don't want to be 14:03 specific and there's a difference 14:04 between the patent drawings in the 14:06 manufacturing drawing patent drawings 14:08 are very broad you know their their 14:10 labels to match the elements of the 14:13 patent but your manufacturing ones 14:14 they've got to be right down to 14:17 millimeters it's right and so you know 14:20 different mindsets and so I get in 14:22 better sometimes that are hard to 14:23 understand that but you're exactly right 14:25 a licensee is renting the right to use 14:29 the intellectual property mmm all right 14:31 and if they go in and it's going to be 14:33 cheaper to make it by making some 14:35 changes it's not it's your end up eating 14:38 your inventory you can still go and sell 14:40 it and a lot of times they will buy that 14:41 inventory and they will go ahead and go 14:43 to market with that unless there's just 14:45 some really serious material changes 14:47 because they don't want that gap in 14:49 selling they want to be able to you know 14:51 get to market as smoothly as possible so 14:56 that's kind of what we look at is in 14:58 getting the products out there but 15:00 companies come to professional trade 15:03 shows it's when you say I contact them I 15:05 look for them in a trade show yeah they 15:07 look for me at a trade show they come 15:09 shopping in our space at a trade show 15:10 and to see what is their next project 15:13 going to be it's something that they 15:15 usually picked up in a trade show trade 15:17 shows are like their mold where they're 15:18 going to go shopping hmm get to them 15:21 after the show they've got layers of 15:23 gatekeepers to keep you out is not 15:28 working on the project that they got it 15:29 the last trade show tips that's where 15:31 they go shopping so yeah I mean 15:34 and we I was going to definitely going 15:36 to get into that real quick so so the 15:37 best thing to do I have a product and 15:39 i'm not sure what to do with it try to 15:42 either locate and we'll go through your 15:44 contact information or the end to end of 15:48 the show but but just to go to a trade 15:50 show walk around do you take your 15:51 product do you take a sale sheet I mean 15:53 what's the best thing to do yes and yes 15:56 we had we just got back from entries 16:00 which is home health care and I went out 16:02 there with nine inventors and one of one 16:05 of the inventors was in there featured 16:06 showcase and I said okay you've got a 16:11 motorized wheelchair that starts out 16:13 with a hoverboard so cool now you can 16:15 take an old wheelchair and set it on top 16:18 of a hoverboard and you have got for a 16:21 few hundred dollars now a motorized 16:22 wheelchair that is just so stable and so 16:25 easy to use but it was sitting in a 16:28 showcase well you had another one there 16:30 and I did you need to get out and ride 16:31 this around he won third place for 16:34 innovation um but it was only because he 16:36 got out there and showed it around now 16:38 he is going to the national hardware 16:40 show with us he's out of Boston and the 16:43 hoverboard buddy system is he starts out 16:46 with a platform that goes on to any 16:48 hoverboard but he has different 16:49 accessories that go on to it so while he 16:51 was at meant trade with the wheelchair 16:54 he's going to the national hardware show 16:56 with a two wheel dolly that is now 16:58 motorized Wow and a golf cart maybe I'll 17:03 show both of those in the product launch 17:05 area the you know the showcase premier 17:08 area to be out there but you will also 17:11 ride those around the entire convention 17:14 hall to get people's you know and the 17:16 media's attention about this and what 17:18 he's licensing then is that platform 17:21 that goes over the over the hoverboard 17:24 and that way then he's got about a half 17:26 a dozen different accessories that go 17:29 with it that will turn it into a 17:31 different work items so he's taken up a 17:33 fun toy and turned it into a work horse 17:37 yeah yeah wow talk about innovation 17:39 that's and being able to put like you 17:41 said put it on a stable base oh it's 17:44 it's amazing i I've ridden it many times 17:47 on 17:47 you know farmers market and at the 17:50 hardware show last year and it is so 17:52 stable and it just it's just zoom yes 17:55 wonderful that's so there are a lot of 18:00 shows out there yeah and is there a 18:03 place that people can find out where the 18:04 shows are or should they just contact 18:06 you or do you have it on your website or 18:07 should they get is there somewhere else 18:09 to go the easiest place to go with you 18:12 know when you look at who's going to be 18:14 selling your product all right so if 18:16 it's a baby product you know there's 18:18 somebody know off the top of my head 18:19 there's the ABC Kids Expo there's med 18:21 trade for home health care but there is 18:23 a show for everything yeah the national 18:25 beverage shots okay and I'm going with a 18:28 client to that one so there is a show 18:31 for everything now the national hardware 18:32 show is kind of all-encompassing it's 18:34 just a gigantic show you've got 18:36 everything there from home and garden to 18:38 car accessories and the pet products and 18:42 you know outdoor products anything that 18:45 you would find in your target walmart if 18:48 you're looking at your home your 18:49 basement your outdoors your garage your 18:51 kitchen anything so it's one of the ones 18:54 that's all encompassing it's easier 18:56 easier certainly easier for us to get 18:57 you I've been to the National asphalt 18:59 shell oh that was fun but very 19:03 successful for the inventor because he 19:05 had a cool way of putting those glass 19:07 beads down into go on asshole and he had 19:11 people actually coming in and buying his 19:13 prototypes and wheeling them out the 19:14 door and they were not cheap um but very 19:18 cool so the best way to find your trade 19:21 show is to look at you know where would 19:24 your product to be sold and then to 19:27 contact that sore and ask them for a 19:29 name of a Salesman or a distributor you 19:31 know the other way to do it is to you 19:33 know if the ideal licensee is pepsi-cola 19:36 bottling then you call them up and say 19:39 what trade shows do you go to hang all 19:43 right so some of it is you know you 19:44 better do a little reconnaissance you 19:45 got to dig around um because the trade 19:48 shows they're all over the country you 19:49 know the asphalt one was in Nashville 19:51 I've been to the global pet expo in 19:53 Orlando fashion shows in New York arm 19:57 the outdoor living show in Chicago 20:01 so they're all over the country and you 20:04 just never know some of them move around 20:05 some of them stay in the same place 20:06 every year but the best thing to do is 20:09 to start asking questions yeah I want 20:11 you know once to talk specifically about 20:13 their industry more than happy to point 20:16 them in the right direction or to let 20:18 them know if I've been to one of those 20:20 shows I don't have my travel with the 20:23 inventor to go to a specific show 20:24 because to work a show you cannot go by 20:27 yourself got to have multiple people 20:30 there to get the benefit out of it see 20:33 that's why I you know I would recommend 20:36 and I know you're giving out the 20:37 information and just allowing people you 20:39 know to make that you but anyone is 20:41 listening I would recommend speaking 20:43 with readers beforehand because they are 20:45 vast and a lot of times an inventor 20:48 buoys their product is for a certain 20:50 segment or certain market and you find 20:53 that sometimes you're like wait a minute 20:54 we have a better market to go after 20:56 exactly and the other thing is they're 20:58 expensive hmm you know going to a 21:01 professional show is expensive you know 21:03 you've got your space but you have to 21:05 pay it to rent everything right down to 21:07 the trash can and a lot of times they've 21:11 got rules about how you get it into 21:13 there so you've got higher Union help to 21:16 get it in the door I hate going to 21:19 Atlanta because they've got different 21:21 rules than Las Vegas and in Las Vegas I 21:24 can wheel everything in on a two wheel 21:26 dolly and so I line up my inventors and 21:28 we unload it on the curb and we push it 21:30 in the door you know Chicago isn't 21:34 easier to work with um but you know 21:37 different different cities have 21:39 different rules and where you can find 21:41 yourself real quick at a 21:42 ten-thousand-dollar mark yeah that's why 21:45 I againi you may think you're saving a 21:47 few dollars by not you know bringing 21:49 somebody on like Rita but in long run if 21:52 you serious about your product you know 21:54 contact somebody who knows yeah the 21:57 gentleman we went to the National 21:58 asphalt show he was getting there a day 21:59 ahead of me and I said do not talk to 22:01 anybody if you don't know who they are 22:04 and so I got there any goes well you 22:07 know these guys offered they were so 22:08 nice and I said don't tell me how much 22:12 your invoices and heat afterwards 22:14 said it was twenty-five hundred dollars 22:16 for that invoice and so yeah you've got 22:19 to be very much aware it's not nice it's 22:21 business and everybody is going to 22:22 charge you something yeah and and of 22:24 course the guys were nice they charging 22:26 popular yeah yeah nice twenty-five 22:28 hundred dollars worth film yeah yeah so 22:30 no no I totally agree and if you can 22:32 pick and choose the right shows I could 22:36 see it being very beneficial because you 22:37 don't have to go to a mall you don't 22:38 want to do a shotgun approach if you get 22:39 somebody like yourself who knows which 22:41 ones to target and even then going to a 22:44 professional trade show is far more 22:47 valuable dollar for dollar to your 22:49 market research and selling your 22:51 products than doing a marketing campaign 22:53 with an advertising agency because 22:56 they've got no skin in the game they're 22:57 going to send you an invoice you don't 23:00 know if it's going to be successful in 23:01 infomercials are probably the worst stay 23:05 away from there always somebody calls 23:07 you on the phone and says oh you know 23:08 we've got this TV event I know your you 23:10 know your blood starts you know pumping 23:11 and you get real excited first question 23:13 out of your mouth is how much is it yes 23:16 always ask how much is it it's amazing 23:19 how they hide that down in the fine 23:21 print yeah it's great advice because 23:23 they're getting you excited because they 23:24 know you're mostly attached yep but if 23:27 you know you've got a product for 23:29 serving breakfast and it airs at two in 23:31 the morning anybody serving breakfast is 23:33 still asleep that's true exactly and if 23:36 it is common sense and again in most 23:38 inventors you gotta really step back 23:40 don't make quick decisions it's usually 23:43 not going to benefit you in less again 23:44 you got some good education you talk to 23:46 somebody you really need to get someone 23:48 who's not emotionally attached to is all 23:50 about business you know again somebody 23:52 like Rita who will make the right 23:53 decision because again read out how do 23:55 you work with your inventors you charge 23:58 your money up front how does that work 23:59 no I do not charge you a frenzy because 24:02 I cannot guarantee we will get to deal 24:03 then it takes time and persistence and 24:05 patience that we end up having a pretty 24:08 close relationship I charge a percentage 24:10 of the royalties from the licensing exam 24:13 so the easiest way to look at it is for 24:16 every dollar royalty that we are paid 24:18 for the product I get 20 cents and the 24:21 inventor gets 80 cents and for that 24:23 twenty cents then we do the legal and 24:26 financial review so that we know 24:28 the licensee is doing what they're 24:30 supposed to be doing what they promised 24:31 and they're doing it in a timely manner 24:33 so we go out and we kind of look at you 24:34 know if they say they only sold this 24:36 many but we know that they sold out at 24:38 several ace hardware stores then we want 24:40 to go in and do an audit and then we're 24:43 looking at you know the numbers since 24:45 you know the previous audit or for a 24:47 period of time so that we know that 24:49 they're being straight with us sure 24:50 they're moving on to their next idea 24:53 they won't use me I want to have to deal 24:54 with that I don't charge upfront simply 24:56 because i can't make you urine tea yeah 24:58 well the twenty cents that sounds way 25:00 more than fair i've heard some some 25:02 stories where the cost you know again 50 25:04 50 or even i know it's crazy that's that 25:08 that sounds great now what kind of time 25:10 frame you know and I know the every 25:12 product is different you know somebody 25:13 comes on board you say hey we like your 25:15 product this is what we're going to do 25:17 is there you know this obviously time is 25:20 going to go by I hear let licensing 25:22 takes a little bit about it does i mean 25:24 i always tell people look at somewhere 25:26 between nine and twelve months I've seen 25:28 it happen in a few weeks we have 25:30 gentleman that had a very cool product 25:32 that went on the back of an RV and his 25:35 first time at a trade show the CEOs wife 25:38 was there and she called her husband she 25:40 knows you need to get down here and see 25:41 this she had a signed deal and roughly 25:43 about eight weeks and I mean it was they 25:47 were very good to him that was you know 25:49 a very fair deal he got everything that 25:51 he wanted out of that um I've seen 25:54 nightmare cases where you know there was 25:56 a good offer made but the inventor 25:58 wanted to bring in a separate attorney 26:00 that is like the kiss of death it took 26:03 us two years to get a signed deal and 26:06 their royalties eventually were cut in 26:08 half because the licensee said no and 26:11 then they got a twelve thousand dollar 26:12 invoice from the attorney is my job 26:16 negotiating the deal and not being an 26:19 attorney now I have attorneys behind me 26:21 that cover our backs that they don't sit 26:23 at the table because then you're 26:24 negotiating with the CEO they were if 26:27 you don't bring your attorney to the 26:28 table they don't bring their the deal is 26:31 between us and the CEO it's the 26:34 attorneys job to say all right well you 26:36 know you need to talk about this these 26:38 are the risks and then you decide which 26:40 risks you're willing to accept 26:41 and which ones you're not willing to 26:43 accept but as soon as those attorneys 26:44 sit down all you're going to be doing is 26:46 generating billable time well right 26:49 there that is a huge piece of 26:51 information because the first thing an 26:52 inventor would do is oh I'm getting it a 26:54 lesson di better contact my attorney 26:56 which obviously now you say is a huge 26:59 mistake you want to do everything we 27:00 believe and right but you put those 27:02 attorneys together the only people that 27:04 will make the money is the attorneys and 27:07 there's nothing wrong you're asking the 27:08 attorney to protect you they're doing 27:10 what you're paying right and like I said 27:12 we've got them in the background but 27:14 they're not setting a stable yeah very 27:16 important very important I I would 27:18 totally agree with that because as soon 27:19 as you pull your hand like that the 27:20 other company or the CEOs as well yeah I 27:22 have to do it because I would think that 27:26 the companies that want to license your 27:28 product and I could be wrong they want 27:29 to get into that product they wouldn't 27:31 waste their time they want that product 27:32 for a reason they want to get a gun 27:34 exactly they don't want to waste they 27:36 don't want to waste the time they don't 27:37 want that heartache the lessening of 27:42 their stomach lining by getting into 27:44 hardcore negotiations and I usually see 27:47 them you know sometimes it's taken us 27:49 longer there's been a couple of clients 27:50 that we worked out longer um can't be 27:53 afraid to pull a deal if it's not 27:54 working out and move on we look at the 27:56 size of the company the ratings of the 27:58 company and that's sometimes an inventor 28:00 is so excited they don't think about 28:01 going and looking at the financial 28:03 ratings of a company and you know are 28:06 they registered with their local Better 28:08 Business Bureau do they have any 28:09 complaints filed against them you know 28:11 are they manufacturing other products 28:13 that have really bad ratings hmm so 28:15 that's my job yeah yeah well again 28:17 that's one and that's why when you say 28:19 twenty twenty cents i doubt it you know 28:21 and again those i think it's a great 28:24 deal i think it's a great deal for an 28:26 inventor to be able to give some give 28:27 their product or somebody like yourself 28:29 who's been doing this a long time you 28:31 know what you're doing you have all the 28:32 contacts so twenty twenty cents i think 28:35 is well worth it well i know what i'm 28:38 talking to talking to Rick about it you 28:40 guys how do you even do that at that 28:43 rate and it's like you know I gotta be 28:45 able to sleep at night and the secret in 28:46 life is to not be too greedy and you 28:48 know what you're doing there's a big 28:49 difference when somebody asks for a lot 28:51 of money up front you have to wonder why 28:53 they doing that you're 28:55 now you have skin in the game because 28:57 you know that you can deliver it's a big 28:59 difference that's right it really really 29:02 is really is so going back to the 29:04 contracts because these are questions 29:05 that I get all the time and having 29:07 somebody like you want i'm trying to get 29:08 get the answers that i can give make it 29:11 sound like I know what I'm doing when 29:15 you talk about licensing a product and 29:18 the amounts that the inventors might 29:21 make on those contracts what is the 29:23 what's the average percentage that 29:25 someone is going to get average is five 29:28 to seven percent of the wholesale price 29:30 that is the only thing a licensee can 29:32 control it got no control over retail 29:35 because that's going into a store the 29:37 store page wholesale for it so figure 29:39 five to seven percent of wholesale 29:41 alright so you know for a lot of 29:44 inventors they say and this is really 29:46 key deficit I can do better than that 29:47 myself you know i do myself i get to 29:49 keep all of it all of what exactly 29:52 alright you're looking at a multiple of 29:54 five for manufacturing that means if 29:55 you've got a suggested retail price you 29:59 know where it fits in at ten bucks all 30:01 right that that's all in consumer is God 30:03 when it comes to pricing you don't give 30:05 a well I'm going to charge fifteen 30:06 dollars for a ten dollar item the sewers 30:08 not going to buy it so consumers is okay 30:11 this is a ten dollar item that means you 30:12 have got to make it package it in shirt 30:15 for two all right because the 30:18 distributor is going to buy it for 250 30:19 they're going to wholesale it to the 30:21 store and the store is then I'm going to 30:22 sell it for ten and one piece that wall 30:24 do it you cannot do it all yourself you 30:26 just can't there are not enough hours in 30:27 the day you do not have enough stomach 30:29 lining for this right or the book of 30:31 business store owners all right they 30:35 don't know you they don't know if you're 30:37 going to be able to steal your orders 30:38 they want to deal with a distributor 30:40 they know so now a distributor is in 30:42 there right so when you're looking at 30:44 that pricing and now you've sold it to a 30:46 distributor for 250 you've only got 30:48 fifty cents left for your marketing and 30:50 marketing can cost more than everything 30:53 else combined marketing is this nasty 30:56 animal out there that you can spend 30:58 forever so you know in better go to the 31:00 bank and they take money out people that 31:03 license it go to the bank and they put 31:05 money in which side of that do you want 31:06 to be on okay yeah and 31:09 what inventors don't really account for 31:11 is the time they're going to spend doing 31:14 all this there no and they don't what I 31:17 when I talk to our inventor the command 31:18 I said this is a great product but 31:20 you're giving yourself a job if that's 31:23 what you want to do then that's great 31:25 but dealing with somebody like yourself 31:27 for you now they can go and concentrate 31:29 on something else they're going to get 31:30 that paycheck they're going to get the 31:31 right documentation it's going to be 31:33 said you're you're behind that and for a 31:36 lot of inventors you know that royalty 31:38 check that comes in every quarter is 31:40 extra disposable income you know when 31:42 you've got a better widget all right 31:44 you're going to get something that may 31:45 be tased for a family vacation it pays 31:47 makes a car payment I we had a gentleman 31:50 down arsonist gets really nice private 31:51 schools based on the royalties um but it 31:54 doesn't always mean you're going to get 31:55 to quit your day job ends on do you have 31:58 a game changer in a particular industry 32:00 and for a lot of inventors you know they 32:03 don't all right but going in and this 32:06 fantasy would start doing a start-up is 32:08 just crazy because you can't do 32:10 everything you cannot be your salesman 32:12 and you cannot be the business runner 32:13 you've got to pick one or the other well 32:15 that means then you've got to bring in 32:16 somebody else well are you bringing in 32:19 somebody who knows that particular 32:21 industry or not and so there's so many 32:24 there's so many hurdles to get over to 32:27 do a start-up going inventors are you 32:29 know they may try it eventually they 32:32 call me and they say oh forgot thanks 32:34 take this off my back and I had one 32:35 gentleman we licensed his product he had 32:38 sold over a million units but it never 32:40 quite done big enough to be on its own 32:42 and his wife was his distribution 32:44 network and every night at the dinner 32:46 table after dinner she was the marketing 32:48 about the packaging and pension me 32:50 apartment and everything and she finds 32:52 it I'm going to Florida see the ramekins 32:54 you can come with me or you can stay 32:56 here but I quit yeah close like know 32:59 what and you know I always tell people a 33:01 good invention is like a child you can 33:04 see that you nurtured it sucks you dry 33:06 you throw it out and until you throw it 33:08 out it is not going to grow up and take 33:10 care of you my daughter get a little 33:12 cranky when I say that but you get the 33:14 idea yeah try to be able to get it out 33:16 there so it grows legs of its own or 33:18 it's never going to pay you enough to 33:19 make it worthwhile yeah that's great 33:22 advice it really is 33:23 it's just setting proper expectations 33:25 you know we get a lot of methods as you 33:27 do they want millions and millions and 33:29 millions of dollars and you know it's 33:31 just it's just not going to happen if it 33:33 grows to that that's great but you know 33:36 i would think that even a company 33:38 licensing a product they're taking a big 33:41 chance also probably right oh absolutely 33:43 and gives i want money upfront well 33:45 you're not going to get money upfront 33:46 the reality is they're putting in 33:47 somewhere between a quarter and a half a 33:50 million dollars to get some 33:52 manufacturing the tooling to get it out 33:53 there to do the marketing part of it and 33:55 most inventors do not come to me so you 33:57 know I've got 250 thousand dollars to 33:59 throw this can you help me they're on a 34:00 budget you know they've got limited 34:03 dollars to spend and so when they expect 34:05 then that are going to get this 34:06 outrageous amount upfront well no you've 34:08 got skin in the game with them they're 34:10 willing to take a risk on your product 34:12 because they think that they can make a 34:13 pop from it and you share in that you 34:16 share in the risk you took the risk our 34:17 front now they're taking the risk 34:18 everybody kind of shares in the pain and 34:21 the reward yeah yeah well it sounds like 34:24 you have a lot of fun was what you're 34:26 doing there's no diet and the reason you 34:28 have a lot of fun i think is because 34:29 again i'll say it you know what you're 34:32 doing you know we have seen so many 34:34 wonderful products help that products to 34:36 the big garden we've got two wheel girls 34:38 going to the hardware show this year and 34:40 they both have very different functions 34:42 on products of course that's a 34:45 hoverboard buddy product and you can go 34:48 to the inventor lady website and see the 34:50 products now that we're teeing up to 34:52 take with us but step further the yard 34:55 stuff for the car stuff inside the house 34:57 outside the house babies and dogs and or 35:02 the pet industry is something i think is 35:04 a big industry we get a lot of pet 35:05 products here and there's a huge pet 35:08 section at the national harbor show Wow 35:10 yeah that's what I've heard and I'm glad 35:13 you're kind of confirming to the 35:14 hardware show looks like a comment 35:16 emulation of a lot of different products 35:19 and it's one of the ones that it's a 35:20 must must attend it seems like it is 35:23 it's huge about 4,500 exhibitors Wow at 35:26 the show and just a lot of fun a lot of 35:30 energy Tuesday Wednesday and Thursday we 35:33 actually I rent a house out there for 35:36 me in the staff and then we drive the 35:39 products out there and and and 35:41 everything so yeah it's a big deal next 35:43 one it's great Super Bowl yeah yeah it 35:46 sounds like it in and again you know 35:47 you're making it fun because you never 35:49 know what you're doing you're organized 35:50 you know what to do you have the 35:52 connections you know nobody takin 35:54 advantage you guys when you get there 35:55 it's a lot different than going there on 35:57 your own and saying okay holding a 35:59 product and walking down the aisle is 36:00 gone now to what I did that's that's so 36:02 hard to go by yourself the first time it 36:04 is so hard and where we've got you know 36:07 multiple people that have been there for 36:08 years I actually take someone who I say 36:11 all right this is the bouncer if someone 36:12 comes in and harassing you this is all 36:14 you have to say and then he knows what 36:16 to do so that you know you can move on 36:18 and be talking about your product get 36:20 out there show your product we've got 36:21 you know snap think it's a sign product 36:23 so it's some you know a lot of people 36:26 really learn and then they can grow up 36:28 and get their own space then you know 36:30 maybe they'll come with us one year or 36:32 two years and then there then they're 36:33 ready now they've you know kind of 36:35 geared on that it is not unusual that 36:37 people will go to trade shows every year 36:40 that they're trying to sell their 36:41 product because they get the biggest 36:42 bang for their marketing dollar that's 36:44 great now you go there with products you 36:47 walk around and kind of go I want that 36:49 part can you go talk to them oh 36:50 absolutely hey that's great you know I 36:54 get more people that come to me just 36:56 because of the advertising network and 36:58 asked if I will help them you know for 37:00 next year yeah now all that I believe I 37:02 mean just you know again just your 37:04 success stories I mean we'll definitely 37:06 bring people in and and that's when the 37:08 greatest part about it we're kind of 37:09 running out of time I had so many other 37:12 questions but we'll we'll catch up with 37:14 those but I do want people I would i do 37:16 want to you to let the people know how 37:18 to connect with you if they have a 37:20 product if they have questions is is 37:22 there a best way to connect with you i 37:24 nearly every website we got our website 37:26 inventor lady calm that was a funny 37:28 story because i was down at the chamber 37:29 one day and this guy goes i know you 37:31 you're that inventor lady that works for 37:33 me lady calm was available so inventor 37:38 lady is the easiest way to find me 37:39 inventor lady calm you can google reader 37:41 compton i come up i'm on facebook i'm on 37:43 linkedin easy to find my phone number is 37:45 everywhere but you can put that out on 37:47 your 37:48 your website yeah yeah and all of this 37:50 information will be on our show notes on 37:52 event is Launchpad also and you know I 37:55 would definitely encourage anyone that's 37:58 what since our show that had some 38:00 questions about licensing certainly send 38:02 them to me but send them over to read at 38:03 inventor lady calm which would be 38:05 awesome and if you have a product you're 38:07 looking to license it I mean definitely 38:09 look into utilizing rita services 38:11 because as you can see very 38:13 knowledgeable and experienced in this 38:15 industry so and this was done a ton of 38:18 fun thank you so much i look forward to 38:20 doing it again and you know if you've 38:22 got a product you need to get at the 38:23 artichoke give me a call yes thank you 38:26 so much rita and we will catch up with 38:28 you soon would definitely get invite you 38:29 back on the show maybe I give us a 38:31 little report on what happened at the 38:33 hardware show absolutely all right you 38:36 take care have a great day alrighty you 38:38 too thanks so much bye-bye